Over the last several weeks, the ocean carrier alliances have announced a number of changes to their Asia to U.S.A. ocean services. Changes such as removing entire service strings, implementing void sailing programs, and combining service strings (which effectively removes one or more service loops), are now being implemented. These changes suggest that the carriers are seeking solutions to deal with rising bunker costs, ongoing supply overcapacity in the Asia to U.S.A. trade, concerns over the U.S.A. / China trade tensions, and the ultimate effect on future demand in the market.

The following are the changes announced thus far. The three Asia to United States West Coast (USWC) services referenced below represent a weekly total of 21,300 TEUs removed, or 6.7% of the total capacity to the West Coast. The 2M / ZIM cooperation is the first service adjustment announced for Asia to United States East Coast (USEC).

Alliance	Service String	Effective	Origin	Service	Destination
2M	EAGLE	early-July	Taiwan / China / Korea	Asia to USWC	Vancouver / Seattle
Ocean Alliance	AAC	late-August	Shanghai / Ningbo	Asia to USWC	Long Beach
THE Alliance	Combine PS5 & PS8	August	China	Asia to USWC	Prince Rupert / Long Beach / Oakland
2M / ZIM	Combine 7 services to 5	September	China / Southeast Asia / Korea	Asia to USEC	U.S. East Coast

Peak Season Perspective:

This overall reduction in capacity will yield better vessel utilization, increasing the likelihood of overbooking. Space is at a premium now and we anticipate that the ocean market will continue to be very dynamic over next few months. MIQ Logistics is fully engaged with our ocean carrier partners and will strive to minimize service interruptions.

MIQ will continue to monitor capacity and service changes in the ocean freight market. We will continue to provide carrier updates and announcements as they become available.

For more information, please contact your local MIQ Logistics representative.